LGIM's Onuekwusi on defensive investing in uncharted territory

How does one invest defensively in the current market environment? Several years ago, and for decades beforehand, the solution would have been very simple: build a portfolio with heavy exposure to fixed income, particularly the so-called risk-free return available on developed market government bonds. But times have changed as central banks have tried to stimulate their economies by taking unprecedented steps to encourage governments, companies and individuals alike to borrow at very low interest rates. This policy action has provided a strong tailwind for fixed income investments in rec...